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General News    H2'ed 7/4/09

Iraq, Bush I, and BNL and Barack Obama's DOJ

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In court, Cook savaged the prosecutor's case, peppering the court with classified government documents he claimed had been "shoved under his hotel room door during the night." However Cook got the documents, they were the final straw for Judge Shoob, whose angry glare finally convinced Ms. McKenzie to agree to allow Drogoul to withdraw his guilty plea and go to trial.

Two weeks later another shoe dropped. The court now knew that someone within the U.S. government had deliberately withheld evidence from the court. With a full-blown trial coming up, Cook was certain to produce even more government documents that the prosecutor had earlier claimed didn't exist. That's obstruction of justice – a felony. Someone had to cook up an explanation for the missing documents, and pretty quick.

On Oct. 5, CIA Director Robert Gates suddenly admitted that the CIA had withheld documents relating to the BNL affair. The Department of Justice breathed a sigh of relief and was quick to claim that, had the CIA told it of this evidence, it would have certainly shared it with the court.

But wait. Why would the CIA, which rarely admits or denies anything it does, voluntarily step forward and admit this? The same question occurred to Senate Intelligence Commit-tee Chairman David Boren, who summoned the. CIA behind closed doors and demanded straight answers. Gates owed his confirmation as director of the CIA to Boren, who vouched for him when others on the committee wanted to deny confirmation because of his role in the Iran/Contra affair. On Oct. 8, under Boren's angry questioning, Gates admitted that the CIA had not withheld the documents on its own. He said the agency had been instructed to withhold the documents by senior officials at the Justice Department. Attorney General Barr, who now headed the depart-ment, had come there from the CIA several years earlier.

(It was not the first time an administration had tried to have the CIA take the fall in order to stop a growing scandal. Richard Nixon's first tried containing Watergate by pinning it on the CIA and to throw the cloak of national security over the whole matter.)

The Justice Department angrily denied the CIA's charge, and a remarkable public fight broke out between the two federal agencies. FBI Director William Sessions had been watching all this from the sidelines. When federal Judge Shoob first began complaining that he believed someone in government was hiding information from the court, Sessions had suggested to his Justice Department superiors that the FBI investigate the charge. But Sessions was denied permission to investigate. On Oct. 10, after the CIA admission, Sessions acted on his own, announcing that he had ordered the FBI to open an investigation. On Oct. 12 the Justice Department's Office of Public Integrity announced that it had opened a criminal probe, too-a probe into anonymous allegations that Sessions had charged private phone calls and travel to the agency.

Sessions had earned a reputation as a straight-shooter since his appointment in 1986. Close associates were outraged and went public, charging that Sessions was being punished for his long-standing refusal to politicize the FBI for the current administration. Sessions has been in frail health since he was appointed. When he was made FBI director, he did not take his job for six weeks while he recuperated in hospital for a chronic bleeding ulcer.

But things had gone too far now to stop the great unraveling of the BNL scandal. Sen. Boren called on the Justice Department to step aside and appoint a special prosecutor. Last Friday, Oct. 16, Attorney General Barr held a news conference and announced that he would not appoint a special prosecutor, but did name retired federal Judge Frederick Lacey to con-duct an independent investigation of the Justice Department's handling of the BNL case. This investigation would not be completed before the November election.

The presidential campaign and congressional recess have kept the Iraqgate scandal from exploding into full bloom. But once the dust settles in January, that will quickly change. First Drogoul's trial will be marked by sensational public testimony about how the Bush administration circumvented Congress to secretly fund Saddam Hussein's military buildup and the cover-up that followed.

Those revelations will in turn spark congressional hearings as Democrats, now in con-trol of the White House for the first time in a dozen years, smell Republican blood. By piling this scandal atop the Iran/Contra affair, they will try to drive a final nail in the coffin of the Republican Party for many years to come.

But for George Bush and those he dragged into this sordid scheme, things look particu-larly bleak. Out of power, presumably, and no longer in control of the Department of Justice, Bush can no longer manipulate events. Even the shredder won't save him this time. Rep. Henry Gonzalez grabbed the incriminating documents confirming administration complicity in the scheme before they could be shredded-and if he should misplace his copies, he is welcome to mine.

End of original story

2001 Update: As I promised in the introduction there is more to tell. During the 1992 Presidential campaign I spoke to the folks in the Clinton/Gore campaign in Little Rock. They were fully aware of the BNL scandal having better contacts within the Gonzalez investigation than I had. I asked them why they were not using it in the campaign. Rank and file workers for the campaign, particularly those working in opposition research, were equally baffled, and frustrated. They had presented the materials to the campaign leadership and had received an icy reception.
The campaign ended with a Clinton/Gore victory and, it was only months later that Republicans were dragging out dirt on Clinton's dealings with Madison Guarantee Savings and loan in Little Rock. Sources I had among savings and loan regulators in Washington assured me that the Bush administration had been fully briefed on Madison Savings and the Clinton loans during the campaign. Why didn't they use them then?
We move now from what I know to what I believe. I believe that the Bush people got a message to the Clinton/Gore people; "We know about the Madison Savings deals. Use BNL against us and we will use Madison Savings against you. Mutually assured destruction.. political style.

It's the only explanation that makes any sense to me. The BNL caper was pure dynamite. Clinton could have made plenty of political hay with it had he chosen to. He didn't, I believe, because he blackmailed not to.

It's become just a footnote in history now.

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Stephen Pizzo has been published everywhere from The New York Times to Mother Jones magazine. His book, Inside Job: The Looting of America's Savings and Loans, was nominated for a Pulitzer.

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